In a perfect world, everyone is free to create their own business and thrive with no other company trying to harm their brand through unethical means. Unfortunately, many companies will resort to unfair competition to succeed beyond their competitors. The term “unfair competition” describes an array of harmful business practices used to either bolster one’s own profits or bring harm to another company.
Our San Diego unfair competition attorneys understand how state and federal laws aim to prevent this type of behavior, and we investigate whether companies are engaging in unlawful practices. If another company is using malicious methods to bolster their own businesses or if you are facing unjust accusations of unfair competition, speak with us. We can meet with you, analyze your options and chart a path towards a successful resolution for you and your business.
Business Practices That Qualify as Unfair Competition
Business and competition go hand-in-hand, but that doesn’t mean an organization can resort to unfair business practices. A competitor’s deceptive or wrongful acts can result in monumental damage to your business. Fortunately, there are federal and state laws designed to protect the creative, intellectual and economic investments made by a business in distinguishing themselves and their products. Below we’ll discuss examples of unfair competition and how you can protect yourself.
Unfair competition is an umbrella term for several different types of economic torts. Examples of unfair competition include:
- Trademark infringement is the unauthorized use of a trademark or service mark on or in connection with goods or services that is likely to cause confusion about their source.
- Unauthorized substitution of one brand of goods for another is also known as “bait and switch,” in which a seller uses trademarked images on their products for financial gain.
- Misappropriation of trade secrets includes stealing a competitor’s secrets and using them for financial gain.
- False representation of products or services is when someone makes any materially misleading product warranty or guarantee.
- False advertising can include exaggerated claims or straight up lies about a product or service.
State and federal laws both protect business owners when it comes to unfair competition. Courts have a number of tools to prevent this, and to restore money or property to victims of unfair competition. In California, victims can collect monetary and injunctive relief. If you’re a victim, the courts look at several factors when determining compensation, including the number of violations, the seriousness of the misconduct, the length of the deceptive acts, and the defendant’s assets, liabilities and net worth.
How Do Unfair Competition Laws Help the Business Sector?
- Unfair competition laws strive to uphold five basic principles of the business market:
- Protect a business’s economic, creative and intellectual investments
- Preserve the goodwill the business has generated with customers
- Dissuade competitors from damaging another business’s goodwill
- Encourage clarity to consumers about which brand they are supporting
- Promote competition by encouraging companies to create better quality products than their competitors
Companies that aim to impugn the relationship that another business has with its customers, or if it attempts to deceive customers about which product they are buying, could face accusations of unfair competition. Trademark infringement, false advertising and exposing trade secrets are all types of unfair competition that are actionable in a court of law.
Handling Deceptive Business Practices in California
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